Saturday, 7 May 2016

Last week, victims of Robert Allen Stanford’s Ponzi scheme filed another class action lawsuit against the law firm that, they allege, helped the former chairman and CEO conceal the fraudulent scheme from government regulators.

The named plaintiffs, Sandra Dorrell and Phillip A. Wilkinson, both Texas residents, filed their complaint in the U.S. District Court for the Northern District of Texas, Dallas Division, April 28.

The defendants include Proskauer Rose LLP, an international law firm that is headquartered in New York City and has 13 offices worldwide, and Thomas V. Sjoblom. Sjoblom was a partner at Proskauer from 2006 to 2009.

“All of the Plaintiffs and members of the putative class invested in the Stanford Financial Ponzi scheme by purchasing SIBL (Stanford International Bank Ltd.) CDs or placing their money in other investment accounts with SIBL,” the investors explained in their 96-page complaint. “Over the years that Plaintiffs and the members of the putative class purchased and maintained investments in SIBL, Plaintiffs and the members of the putative class were repeatedly and uniformly told, either directly by their Stanford Financial FAs or via Stanford Financial promotional materials, that, inter alia: (1) an investment in SIBL was safer than investing in U.S. banks because SIBL did not make loans but instead held its funds in a safe and highly liquid portfolio; (2) Stanford Financial was a U.S.-based business regulated by the U.S. Government; and (3) that an investment in SIBL was completely safe and secure because it was guaranteed and insured by Lloyd’s, was thoroughly regulated, was audited by an ‘outside’ audit firm and subjected to regular, ‘stringent’ risk management examinations.

Tuesday, 3 May 2016

Two months after a federal appeals court rejected their case, investors who lost billions in a Ponzi scheme orchestrated by R. Allen Stanford have filed a brand-new class action against the company’s former outside counsel at Proskauer Rose.

The move comes as Chadbourne & Parke, which also once counted Antigua-based Stanford Group as a client, has agreed to pay $35 million to resolve parallel investor claims. (The settlement was first reported in February, but the size of the deal was not known.) If the settlement is approved, the funds, minus a contingency fee, will be distributed among investors who bought bogus Stanford CDs.

The new case against , meanwhile, landed Friday in federal district court in Dallas, claiming $5 billion in damages. Once again, the plaintiffs are looking to hold Proskauer responsible for the actions of its former partner, Thomas Sjoblom, who allegedly helped Stanford conceal his Ponzi scheme from regulators.

Sjoblom, who joined Proskauer from Chadbourne in 2006 and represented Stanford’s company while at both firms, is also named as a defendant.

The U.S. Court of Appeals for the Fifth Circuit dismissed the original case against Proskauer on March 10, following six years of litigation and two trips through the appeals courts. The panel found that, under Texas law, an attorney is shielded from liability if the alleged wrongdoing occurred while he was defending a client.

But according to Friday’s complaint, the Fifth Circuit’s decision also left open a narrow window for the plaintiffs to sue again under Texas’ Securities Act. Their 99-page complaint, filed by Edward Snyder of San Antonio-based Castillo Snyder and cocounsel Strasburger Price on behalf of a putative class of 21,000 Stanford investors, hopes to take advantage of that window..................